What Is Binance and Are Your Crypto Holdings Safe There?

 With daily trade volume in the billions of dollars, Binance is the largest cryptocurrency exchange globally. Its wide product range and dependable security have been two of the main factors in its success throughout the years. In addition to having over 1,000 crypto trading pairs and supporting the trade of over 300 altcoins, Binance offers a plethora of extra tools, like Auto-Investment, an NFT generator, and robust support for crypto-staking.

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The Binance Product Portfolio

Businessman Changpeng Zhao, a Chinese Canadian, founded Binance in 2017 and provides a wide range of services related to cryptocurrencies. Below is a summary of Binance's previous offerings.

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Trading Platforms

Currently, Binance operates three primary trading platforms. These are Binance US (for users in the United States), Binance DEX, and Binance.com (the primary service for clients from abroad). Binance DEX is built differently than Binance.com and Binance US, which hold assets on behalf of clients and adhere to tight regulatory legislation.

Users can trade freely and directly with other traders on the DEX platform, a decentralized exchange. The two main methods for monitoring cryptocurrency transactions and users—Know Your Customer (KYC) and Anti Money Laundering (AML) procedures—were absent from Binance for a considerable amount of time. Nonetheless, Binance declared in 2021 that it was adding KYC and AML to the platform in order to abide by laws in a number of nations.

Although Binance US mostly serves American customers, American nationals cannot access Binance.com or Binance DEX. Nevertheless, because of trade limitations, the three websites jointly forbid consumers from 28 countries from using Binance services. Albania, the Democratic People's Republic of Korea, Cuba, Iran, Iraq, Somalia, Sudan, Syria, Venezuela, and Zimbabwe are now on the Binance list of blacklisted nations.

Binance Coin

The Binance Chain blockchain powers Binance Coin (BNB), the company's native cryptocurrency. Within the Binance ecosystem, BNB is utilized as an investment coin. Due to its low rates, which contribute to expanding its use cases, Binance clients also frequently utilize it to pay trading fees on its platforms.

Currently, the Binance Visa card, which enables payments using Bitcoin and BNB coin linked to your Binance account, is accepted by over 40 million merchants globally.

The Binance Smart Chain

Running in parallel to the Binance Chain, the Binance Smart Chain (BSC) is an auxiliary blockchain system that facilitates the decentralized applications (dApp) ecosystem. It facilitates staking projects and lets smart contracts be created on the blockchain.

Since its launch in April 2020, its scalability, cheap fees, and cross-chain interoperability have made it extremely popular among the decentralized finance (DeFi) community. Peer-to-peer financial services based on blockchain technology, known as DeFi initiatives, let users lend, borrow, and invest money. The general consensus among cryptocurrency fans is that they may effectively circumvent traditional banking institutions since they lack centralized authority.

Value DeFi, PancakeSwap, Harvest Finance, and other well-known DeFi initiatives are dependent on the BSC system. Additionally, BSC is home to NFT initiatives including the Battle Pets gaming NFT and the BakerySwap marketplace.

Is Binance Safe? Should You Keep Your Crypto on Binance?

It is crucial to remember that bitcoin platforms are vulnerable to attacks, either direct or indirect, just like any other internet resource. Certain platforms are obviously more vulnerable than others.

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Regarding Binance, its systems have received excellent cybersecurity scores. In 2019, Xiamen SlowMist Technology, a security firm, released a research claiming that Binance had more comprehensive security procedures than most cryptocurrency companies. The company currently rates it as "Excellent." Software integrity, wallet security, server security, and private key security are among the structures that the company analyzes.

Binance Secure Asset Fund for Users

In order to increase user safety, Binance introduced an emergency fund in 2018. This fund was created to shield customers against unanticipated crypto problems, emergencies, and market challenges. BNB, BTC, USDT, and TUSD make up the approximately $1 billion Secure Asset Fund for Users (SAFU).

The U.S. Securities and Exchange Commission (SEC) brought accusations against Binance in June 2023. Operating unregistered exchanges, clearing agencies, unapproved broker transactions, and falsifying trading controls and oversight on the Binance.US platform are among the accusations. If confirmed, it might put Binance and its users in serious danger.

However, Binance is still operating strong, in contrast to the market reaction during earlier SEC probes of other cryptocurrency firms, where money floods out of the exchange and causes price instability. The claims don't seem to have affected its users, and even though the cryptocurrency market was shocked, prices didn't plummet as was the case when the FTX exchange declared bankruptcy.

Nevertheless, it would be advisable to withdraw all cash from Binance until the legal dispute is settled, considering the accusations and other problems the company may be facing.

How to Secure Your Binance Account

It is advisable to adhere to accepted security procedures in order to guarantee the protection of your money on Binance. Here is a summary of some of the best practices.

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1. Create a Strong Password

Securing your Binance account starts with creating a strong password. A strong password should have at least 12 characters, if not 16. It should be a combination of capital and lowercase letters, symbols, and numbers. We advise use a secure password manager to assist safeguard your account since it might be challenging to remember a password that long.

It's crucial to avoid using passwords you've used on other websites. This is due to the possibility that credentials from a compromise on another network could be intercepted and used by hackers to access financial platforms like Binance.

Simple passwords ought to be steered clear of as well. This is due to the fact that brute-force password-cracking software may quickly decipher them.

2. Use Two-Factor Authentication (2FA)

With Binance, customers can increase account security by utilizing two-factor authentication. Four different authentication methods are available to clients: Yubikey, Google Authenticator, Binance Authenticator, and SMS.

With two-factor authentication through SMS, users can utilize an SMS code provided to their phone number to confirm their account credentials. For both Google Authenticator and Binance Authenticator, the Binance account and the app must first be connected by a barcode scan. When the user wishes to log in again, the app will produce a random unlock code.

It is safer to use Google Authenticator or Binance Authenticator to secure the account rather than SMS verification. This is due to the fact that a SIM-swapping attack can get around SMS authentication. Additionally susceptible to SS7 network interception techniques is the security feature.

In addition to SMS, Google Authenticator, and Binance Authenticator, Binance customers can use YubiKey to secure their accounts. To use the platform, a user only needs to connect and authenticate their Yubikey.

Every time the owner wishes to log in after that, they can do so by plugging the key into a USB port to verify the account. Near-Field Communication (NFC) cryptography is the main method used by the hardware-based authenticator to verify accounts.

3. Limit Binance Withdrawal Addresses

Users have the choice to only remove their assets through designated accounts with Binance. The Address Management function permits withdrawals by using a whitelist. Email confirmation is required for every address added. Because of this, it's also advisable to activate two-factor authentication on the associated email account to guarantee email security.

Enabling this security measure stops arbitrary withdrawals to hacker-controlled accounts.

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